ERBIL, Kurdistan Region — London-traded Genel Energy will work more closely with America's Chevron to develop its energy operations in the Kurdistan Region.
“We are delighted to have been chosen as a partner to Chevron. The agreement provides access to a phased development opportunity with significant growth potential at Sarta, and an exciting appraisal opportunity at Qara Dagh," Genel Chief Executive Murat Ozgul said in a statement released on Monday.
The agreement will affect operations at the Sarta and Qaradogh fields. The first is in the east of Duhok province, while Qaradogh is located in Sulaimani south of the capital city.
"Genel will acquire 30 percent equity in the Sarta licence by paying a 50 percent share of ongoing field development costs until a specific production target is reached," read the statement.
It is dependent upon approval by the Kurdistan Regional Government (KRG).
After an unspecified "production milestone" is reached, a "success fee" will then be paid.
The energy sector in the Kurdistan Region which makes up the bulk of revenues is privatized; whereas, elsewhere in Iraq it is state-run.
"Chevron will retain a 50 percent interest in the Sarta licence and the Kurdistan Regional Government will hold the remaining 20 percent. Genel’s estimate of its total spend up to end-2020 is [circa] $60 million," the statement detailed.
Due to successful tests and drilling at additional explorations at Sarta during late 2017, Genel expects "to see these wells placed on production."
"The additions to our portfolio are an important step in our diversification strategy, offering a further opportunity for near-term production and cash-generation," concluded Ozgul.
The energy giant Chevron restarted its oil operations in the Kurdistan Region in 2018. Smaller companies have increasingly taken chances on challenging blocks which larger companies have shied away from.
Oil and gas in the Kurdistan Region are refined locally or sold to Iraq, with some going through a pipeline that terminates at the Turkish port of Ceyhan for sale on the global market. Other quantities are trucked to Turkey.
Smuggling remains a problem and KRG officials have repeatedly said they will tackle the issue. The KRG opened its books to international auditors.
The Kurdistan Region continues to recover from multiple financial crises caused by a drop in global oil prices, budget disagreements with Baghdad, the ISIS conflict, and hosting more than 1.8 million IDPs and refugees.
“We are delighted to have been chosen as a partner to Chevron. The agreement provides access to a phased development opportunity with significant growth potential at Sarta, and an exciting appraisal opportunity at Qara Dagh," Genel Chief Executive Murat Ozgul said in a statement released on Monday.
The agreement will affect operations at the Sarta and Qaradogh fields. The first is in the east of Duhok province, while Qaradogh is located in Sulaimani south of the capital city.
"Genel will acquire 30 percent equity in the Sarta licence by paying a 50 percent share of ongoing field development costs until a specific production target is reached," read the statement.
It is dependent upon approval by the Kurdistan Regional Government (KRG).
After an unspecified "production milestone" is reached, a "success fee" will then be paid.
The energy sector in the Kurdistan Region which makes up the bulk of revenues is privatized; whereas, elsewhere in Iraq it is state-run.
"Chevron will retain a 50 percent interest in the Sarta licence and the Kurdistan Regional Government will hold the remaining 20 percent. Genel’s estimate of its total spend up to end-2020 is [circa] $60 million," the statement detailed.
Due to successful tests and drilling at additional explorations at Sarta during late 2017, Genel expects "to see these wells placed on production."
"The additions to our portfolio are an important step in our diversification strategy, offering a further opportunity for near-term production and cash-generation," concluded Ozgul.
The energy giant Chevron restarted its oil operations in the Kurdistan Region in 2018. Smaller companies have increasingly taken chances on challenging blocks which larger companies have shied away from.
Oil and gas in the Kurdistan Region are refined locally or sold to Iraq, with some going through a pipeline that terminates at the Turkish port of Ceyhan for sale on the global market. Other quantities are trucked to Turkey.
Smuggling remains a problem and KRG officials have repeatedly said they will tackle the issue. The KRG opened its books to international auditors.
The Kurdistan Region continues to recover from multiple financial crises caused by a drop in global oil prices, budget disagreements with Baghdad, the ISIS conflict, and hosting more than 1.8 million IDPs and refugees.
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